Denver, May 11, 1999 ? Qwest Communications International Inc. (Nasdaq: QWST), an Internet communications company, SAP America (NYSE ADR: SAP) and Hewlett-Packard Company (HP) (NYSE:HWP) today announced a strategic relationship that will significantly change the delivery of Internet-based applications and services to business around the world. This initiative will combine Qwest's reliable, high-speed network with the SAP industry leading business software and HP's state-of-the-art technology and services.
This is the first in a series of strategic initiatives designed to firmly establish Qwest as a leading Application Service Provider (ASP), delivering Internet-based applications and services to business around the world.
To help support the Qwest initiative, SAP America, the U.S. subsidiary of SAP AG, the world's leading provider of enterprise resource planning (ERP) software, will offer its R/3 business solution to customers through the Internet, making Qwest an important provider for the delivery of SAP? R/3 business solution. HP will invest $500 million in server hardware, software and services into Qwest's application hosting CyberCenterssm in exchange for monthly fee revenue based on utilization of the platform. These CyberCenters will be located throughout the U.S. and connected to the Qwest Internet Protocol-based communications network.
The strategic agreements with SAP and HP allow them to market Qwest services to current and new customers, providing businesses with an easier, more reliable and secure way to manage a wide range of critical business operations over the Internet. Qwest plans to offer the services to business customers in the next few months as additional application hosting CyberCenters come online in California. These world-class Centers will be directly connected to the Qwest fiber-optic network, offering a single-source for end-to-end Internet solutions with technical and engineering staff monitoring customer applications 24 hours a day, seven days a week. Qwest currently has three CyberCenters in Weehawken, N.J., San Francisco and Denver and by the end of 1999 plans to have seven centers throughout the U.S.
"For companies to be successful in the global economy, they must have the information and technical resources that allow them to monitor and manage their operations in real-time," said Qwest's Lewis O. Wilks, president of Internet and multimedia markets. "Qwest continues to look for ways to leverage the benefits of Internet-based delivery of communications services to business customers and we are confident that by working with SAP and HP we will rapidly accelerate the demand of hosted application services."
World-class Solution to Benefit Business Customers
By combining the high-speed, scalable, reliable and secure Qwest network and CyberCenters with leading-edge SAP software solutions and HP's state-of-the-art server platform and services, business customers will be able to:
- Provide a simple, easy-to-use solution that provides company-wide access to mission-critical business applications through the Internet;
- Purchase solutions on a per-user, per-month basis;
- Make better use of their information technology resources;
- More accurately manage and forecast information technology costs
Analysts estimate that the outsourcing of business applications represents a $21 billion market opportunity by the end of 2001, with small and medium-sized companies driving the demand for these services. To address this burgeoning market, Qwest, in conjunction with SAP and HP, will offer customers a hosted end-to-end, Internet-based solution that incorporates hardware deployment, data-center server and operations, application software, systems management and software upgrades and maintenance.
"This strategic alliance brings together three market leaders that recognize the power of the Internet and how it will enable new business relationships among partners, service providers and customers," said Kevin McKay, president and CEO, SAP America. "The agreement further enhances the strategic SAP initiative to ensure companies of all sizes and industry segments have access to the premier business solution and can fully leverage their supply chains."
Businesses of all sizes will now have the ability to rapidly deploy and immediately benefit from enterprise resource planning software without encountering some of the financial and time constraints commonly associated with a typical deployment.
"This is a huge endorsement for HP's e-services strategy because Qwest evaluated all the major solutions providers and chose HP based on its superior scalability, high availability and end-to-end management capability," said William V. Russell, executive vice president and chief operating officer of HP Enterprise Computing. "We're already the number one partner for SAP worldwide and now we're delighted to be able to announce with Qwest and SAP the world's largest and most robust e-service for enterprise applications."
Qwest Communications International Inc. (Nasdaq: QWST) is a leader in reliable and secure broadband Internet-based data, voice and image communications for businesses and consumers. Headquartered in Denver, Qwest has more than 8,500 employees working in North America, Europe and Mexico. The Qwest Macro Capacity® Fiber Network, designed with the newest optical networking, will span more than 18,500 route miles in the United States when it is completed by mid-1999, and an additional 315-mile network route that will be completed by the end of the year. In addition, Qwest and KPN, the Dutch telecommunications company, have formed a venture to build and operate a high-capacity European fiber optic, Internet Protocol-based network that has 2,100 miles and will span 9,100 miles when it is completed in 2001. Qwest also has nearly completed a 1,400-mile network in Mexico. For more information, please visit the Qwest web site at www.qwest.com.
SAP, the world's largest enterprise software company, provides companies of all sizes with business solutions that deliver A Better Return on Information(SM). SAP products and services integrate an organization from financials and human resources to manufacturing and sales and distribution. This integration enables companies to optimize supply chains, strengthen customer relationships, and make more accurate management decisions. Founded in 1972, SAP today leverages a global network of people, processes and products to assure customer success. SAP is listed on several exchanges including the Frankfurt stock exchange and NYSE under the symbol "SAP." The SAP World Wide Web site can be found athttp://www.sap.com.
Hewlett-Packard Company -- a leading global provider of computing and imaging solutions and services for business and home -- is focused on capitalizing on the opportunities of the Internet and the proliferation of electronic services.
HP had computer-related revenue of $39.5 billion in its 1998 fiscal year. HP plans to launch a new company ("NewCo") consisting of its industry-leading test-and-measurement, components, chemical-analysis and medical businesses. These businesses represented $7.6 billion of HP's total revenue in fiscal 1998. With leading positions in multiple market segments, this technology-based company will focus on high-growth opportunities such as communications and life sciences.
HP has 122,800 employees worldwide and had total revenue of $47.1 billion in its 1998 fiscal year. Information about HP, its products and the company's Year 2000 program can be found on the World Wide Web at http://www.hp.com.
This press release is not an offer of securities for sale in the United States. Securities of KPNQwest may not be offered or sold in the United States absent registration or an exemption from registration. Any public offering of securities of KPNQwest to be made in the United States will be made by means of a prospectus that may be obtained from KPNQwest and that will contain detailed information about KPNQwest and management, as well as financial statements. This release may contain forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. Important risk factors that could cause actual results to differ from those contained in the forward-looking statements include potential fluctuations in quarterly results, dependence on new product development, rapid technological and market change, failure to complete the network on schedule and on budget, financial risk management and future growth subject to risks, KPNQwest's ability to achieve Year 2000 compliance, and adverse changes in the regulatory or legislative environment. KPNQwest undertakes no obligation to review or confirm analysts' expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
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